Will VeriSign be able to engage in tiered pricing for .com soon?

[George Kirikos <gkirikos@xxxxxxxxx>]

According to the draft new gTLD contracts for Section 7.3:

http://www.icann.org/en/topics/new-gtld-draft-summary-changes-24oct08-en.pdf
http://www.icann.org/en/topics/new-gtld-comments-en.htm

"Price controls have been removed for 2008 in favor of the transparent
pricing model outlined above."

Section 3.2.b) of the .com registry agreement states:

http://www.icann.org/en/tlds/agreements/verisign/registry-agmt-com-01mar06.htm

"ICANN shall not apply standards, policies, procedures or practices
arbitrarily, unjustifiably, or inequitably and shall not single out
Registry Operator for disparate treatment unless justified by
substantial and reasonable cause."

In my opinion, VeriSign (and other existing gTLD operators) are almost
being invited to ask for their contracts to be amended to get the "same
treatment" as new gTLDs in regards to the elimination of pricing caps.
This once again could re-open the issue of tiered pricing that most
have fought very hard against in order to protect registrants:

http://www.circleid.com/posts/icann_tiered_pricing_tld_biz_info_org_domain/

I believe the language of these proposed new gTLD contracts needs to
have hard caps in place to protect existing gTLD registrants. New gTLDs
are NOT effective substitutes for existing gTLDs, and thus
"competition" isn't going to keep VeriSign's pricing power in check.
Even with a 10-year transition period, it would shock the conscience if
VeriSIgn was permitted to arbitrarily and unilaterally raise the
renewal price of .coms to millions or billions of dollars per year (say
$1 billion/yr for Google.com, $10 million/yr for Hotels.com, $50
million/yr for Cars.com, $30 million/yr for Games.com, or whatever the
market would bear), effectively re-auctioning the entire list of
premium domain names to the highest bidder, removing the existing
registrant and replacing things with .tv style pricing.

Alternatively, all existing gTLD operators need to agree to language,
before any new gTLDs are approved, that make explicit that the hard
caps cannot be removed irregardless of whatever happens in other gTLDs.


I also find it disturbing that the ICANN staff who prepared the draft
agreements stated that for the existing 2005-2007 gTLD agreements for
Section 7.3:

http://www.icann.org/en/topics/new-gtld-draft-summary-changes-24oct08-en.pdf

"(ICANN?s unsponsored gTLD registry agreements have not included price
controls.)"

This is demonstrably FALSE, see Section 7.3 of the current .biz, .info
and .org agreements:

http://www.icann.org/en/tlds/agreements/biz/registry-agmt-08dec06.htm
http://www.icann.org/en/tlds/agreements/info/registry-agmt-08dec06.htm
http://www.icann.org/en/tlds/agreements/org/registry-agmt-16jul08.htm

each of which have in place a "Maximum Service Fee" due to the hard
work of many in the ICANN community.

It's very alarming that such misleading information is being put out by
ICANN in regards to the description of existing consumer protections
that exist for registrants. ICANN's registries have managed to create a
"presumptive renewal" for themselves at the expense of the ICANN
community who would fare better if registry operations were tendered to
the lowest bidder. At a minimum, existing domain registrants should
expect presumptive renewal of their own domains at a constant price, or
one that reflects a price index of global technology costs (which is
generally far below that of the Consumer Price Index).

Sincerely,

George Kirikos
http://www.kirikos.com/